Fed sticks to US stimulus reduction

MARTIN CRUTSINGER
Last updated 08:34 30/01/2014
US Federal Reserve Chairman Ben Bernanke
Reuters

LAST CALL: US Federal Reserve Chairman Ben Bernanke.

Relevant offers

World

Man loses job after accidentally texting explicit image to HR manager How TripAdvisor altered your holiday-planning universe forever Fake ultrasounds, fake bellies and Fake a Baby.com get US girl in trouble Wife of former Bathurst Resources boss jailed for welfare fraud Australia's 7-Eleven stores put on life support Rupert Murdoch brings Rebekah Brooks back to News Corp after phone hacking scandal Financial crisis returns? Fund manager warns of market trouble ahead Google refines logo as it prepares to join Alphabet Wall St slides nearly 3 per cent as China fears resurface Yahoo CEO Marissa Mayer pregnant with twins

The Federal Reserve says it will cut its monthly bond purchases by an additional US$10 billion (NZ$12.1b) to US$65b because of a strengthening US economy.

It's doing so even though the prospect of reduced Fed stimulus and higher US interest rates has rattled global markets.

The Fed also reaffirmed its plan to keep short-term rates at record lows in a statement issued after Ben Bernanke's final policy meeting. Bernanke will step down Friday after eight years as chairman.

Many investors fear that reduced Fed bond buying will boost US rates and cause investors to move money out of emerging markets and into the United States for higher returns. Currency values in emerging nations have fallen. India, Turkey and South Africa have raised rates to try to protect their currencies.

Ad Feedback

- AP

Special offers

Featured Promotions

Sponsored Content